Gold ends at $1,160.10; lowest since Nov. 2014
San Francisco (Mar 10) Gold settled at it's lowest level in nearly four months on Tuesday as the dollar rose to its highest in nearly 12 years and renewed expectations of a mid-year interest rate rise in the United States kept prices in check.
U.S. gold futures closed down $6.40 an ounce at $1,153.80, its weakest closing price since November 12. Spot gold was last down 0.5 percent at $1,160 an ounce.
Platinum fell to a new near-five-year low of $1,125.75 an ounce. The metal has dropped 5.1 percent since the start of the year on expectations of lower demand from the automotive sector and higher mine supply.
"Dollar strength overnight in Asia sent the complex lower," Deutsche Boerse's MNI senior analyst Tony Walters said.
"The trend is your friend and people will continue to sell rallies," he added. "Seemingly the only spanner that could be thrown into the works at the moment is if the Fed doesn't raise rates in June, but the market is short ... and it continues to go in its favor."
Gold took a hit after Friday's strong U.S. non-farm payrolls data boosted expectations that the Federal Reserve would begin increasing interest rates by the middle of the year.
The Fed has kept rates near zero since December 2008, boosting gold. But when the central bank started to signal it was looking to tighten its loose monetary policy, the metal began to fall.
Comments from a top Fed official fueled those expectations. Richard Fisher, president of the Dallas Federal Reserve Bank, said the U.S. central bank should promptly end its easy monetary policy and press ahead with raising rates.
The dollar climbed to its highest since September 2003 against a basket of major currencies, making gold more expensive for holders of other currencies.
Investors were also eyeing talks over the Greek debt crisis, where prolonged uncertainty could help safe-haven bullion.
"Unless the situation surrounding Greece's debts take a huge turn for the worse, the bearish sentiment engulfing gold currently will likely triumph over any mild safe-haven appeal the precious metal is exhibiting," said Howie Lee, analyst at Phillip Futures.
Investor positioning indicated a bearish outlook. Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.43 percent to 753.04 tonnes on Monday.